South China shippers refuse intra-Asia bunker surcharge /19.02.2010

THE Hong Kong Shippers' Council has slammed a move to force exporters in southern China to pay a US$44 per TEU emergency bunker surcharge on all FOB shipments transported on intra-Asia trade routes. Hong Kong Shippers' Council chairman Willy Lin was cited as saying in a letter that if the shippers refuse to pay the surcharge, the carriers refuse to issue a bill of lading. Mr Lin was cited as saying the refusal to pay the surcharge has been led by shippers based in southern China, including the Dongguan Foreign Trade Enterprise.

"South China shippers have once again become the target for discriminatory charges by shipping lines on the China/intra-Asia trade," Mr Lin wrote. "The shipping lines are attempting to charge CNY300 ($44) per TEU and CNY600 ($88) per FEU for all FOB shipments in the intra-Asia trade. Consignees at destination who pay the freight should be responsible for all bunker surcharges.

"The amount represents 16 per cent of the current freight price, which is not only huge but also senseless since oil prices have dropped to $75 today, which negates the justification for any bunker surcharge whatsoever. The 'emergency' bunker surcharge was started in 2008 when bunker prices reached $150 a barrel," he wrote.

"However, the shipping lines are using strong-arm tactics by refusing to issue a bill of lading if the charge is not paid," Mr Lin added. "The Beijing-based China Shipper's Association said that it would file a complaint with the Ministry of Communication, PRC."
The report noted that China introduced a regulation in 2007 that requires container shipping lines to consult with shippers groups before adjusting surcharges.

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